[sethev]

It's hard to imagine a tax that would be sensitive to this difference unless it was a tax on market cap, which would be very odd because shareholders are the owners. So it would be a tax on one entity for the value of assets owned by another.

[creaghpatr]

Startup stock options, if you exercise before a liquidity event, are given a cap gains tax based on the de facto market cap.

[chimeracoder]

> Startup stock options, if you exercise before a liquidity event, are given a cap gains tax based on the de facto market cap.

That's not really the same thing. ISOs are taxed (as income) because you're purchasing something for below-market price, so the difference between the market price and the price you pay is income. If you hold onto it for long enough, you may then be able to qualify for capital gains tax when you sell it, but that's different.

And in addition, that's the individual who's being taxed on it (the value of their own income).

If you think of how this works similarly for publicly-traded companies, it's easier to understand.

[sethev]

Right - that's a completely different topic though. That's an individual paying taxes on a gain that they've realized. Not a company paying taxes based on other people's gains.